Greener pastures

“SPS’ extraordinary frameworks and capability have proven such an effective combination; we’ve made it our primary leadership and performance management tool.”

Peter McClure
CEO, Fonterra Brands NZ
Background
An overview

Fonterra Co-operative Group is a New Zealand based multinational dairy co-operative that produces around 30% of the world's dairy exports. With revenue exceeding NZ$17 billion, it is New Zealand's largest company.

Fonterra Brands (FBNZ) is its New Zealand based brand business responsible for producing some of the world’s most loved dairy products including the likes of Anchor, Mainland, De Winkel and Symbio.

In July 2007, FBNZ’s Executive Team invited us to help them improve the performance of its 1,300 employees across each of its seven manufacturing sites. Once its strategic priorities were agreed, they deployed our process to equip their people with the tools to deliver the outcomes they were looking for.

Challenge:
How to create the next great era for FBNZ

Even though our brands are well established, we operate in a highly competitive market that is under constant pressure from lobbyists, customers, consumers and government officials alike. Therefore, getting our strategy right to ensure it resonated with our stakeholders was paramount to us delivering our objectives.

On the back of the review, Peter (McClure) gave me the mandate to find a solution that would enable our leaders to drive the changes we were after to establish the next great era for the business.

Daniel Love HR Director

Solution:
The Steel Performance System (SPS)

During the strategic review Craig (Steel) facilitated, we identified two areas of opportunity where we believed we could outperform our competitors and in doing so, win additional market share. These areas were ‘innovation’ and operational ‘transformation’.

Once our strategic plan was in place, we agreed the only way we could execute it was by lifting the performance and capability of our people.

How we’ve achieved this is not only testament to Peter’s vision, but a compelling example of how a company can transform the performance of its workforce when led from the front and supported by the right framework.

Daniel Love HR Director

 

Peter and I agreed that if we were serious about proceeding with SPS' programme, we'd better be able to lead it. So in April of 2008, our ELT started working with Craig.

While the makeup of the ELT has changed, the impact was such that every member of the team agreed it had the potential to not only change the game in terms of how we operated as an Executive but create a completely different mindset and culture across the business; which we knew would be crucial to us realising our strategic aspirations.

Once we had the foundations in place, we then rolled the process out to our 3rd and 4th tier leaders to help them bring about the changes we were after across the business.

To simplify the process, we also made the decision to make it our primary leadership and performance improvement tool given the impact it was having on our leaders so although Fonterra had an extensive suite of HR systems and processes, none of it compared to the process SPS offered in terms of helping us build the capability and culture we needed to be successful.

 

What happened

In terms of outcomes, we've realised an unprecedented improvement in our staff performance and engagement. We've increased market share by over 20%, increased our innovation-led revenue from 2% to 16%, improved our profit growth by over 30% and improved our health and safety status from one of Fonterra’s worst performers to one of its best.

Critically, however, what it's done is given us a completely different mandate to challenge ourselves, to engage our people in completely different conversations about their role in the business and the outcomes we need them to deliver. It has also changed the way our leaders engage their people so instead of the focus being on how they manage them, they now see their role being there to enable them to deliver the things they're there for.

What has been interesting, but at the same time, not surprising is the feedback we've received from staff including comments like 'it has completely changed the way I interact with my team' to 'it has given me the mandate to have the conversations with my people that I've alway's tried to have but was never able to' to 'it is without question the single best thing I have ever done in my 15 years of leadership'. 

As we’ve rolled the process out across the business, we can see the momentum building. Today, we are hearing different conversations taking place across the business as staff are more engaged in what they do, and critically, they’re thinking about how they can do it better. 

While improving a company’s culture is a never-ending journey, what we’ve introduced here gives me confidence that we are on to something special. I'm also confident it has given us a formula that will offer us true competitive advantage well into the future.

There’s no doubt, the SPS is by far and away the most powerful tool I have ever come across in terms of developing high performing organisations.

Daniel Love HR Director

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